Business areas in a Business Plan
Strategic thinking comes with experience and analytical skills, and not all entrepreneurs have the capacity to develop the growth plan of their company with a strategic mindset. A strategy is always seen as the set of ideas and decisions on how to make a company successful, creating a compelling value proposition for the market.
However, to create a product or a service successful in the market is not always the result of a strategy: the success can come by the company experience, know-how, personal connections, or even by chance. To detect if the Company is running a clear strategy, it is necessary to answer: are we combining the company output with a homogeneous group of customers? Often the company is running divisions by market areas, by customer segment, by product category or by business functions. In the case it is by customer or by product, a cross combination might occur, but it is often executed by associating the product to the customer base or vice-versa, so matching one factor to the other: for example, the company organizes its sales and functional divisions around "Electronics retailers", "Office supply wholesalers" and "Corporate clients", and set up the marketing campaign around these sales channels. This is an example how the product is generically associated with the market, but it misses any strategic insight (what product features are relevant for these players? and what for the end users? how same consumers might purchase the product in one channel or in another?...).
The approach that let the entrepreneur capture the strategic performance would tackle the analysis differently, for example answering to this question: what are the group of consumers having the same needs, and what part of our proposal can fit them? this would probably bring the company to separate its activities around the client needs and his purchasing and consuming journey.
Basically, the company should not work on defining the products and matching them with the clients, but more assessing the market and setting up a combination product/client which becomes the unit to use to group the company proposal, and the parameter to assess the performance. It is the famous academic classification within a company taught as "Business Area", allowing the company to create more effective marketing campaigns and synergies among its resources and activities.